S Patrick Erdal v Commissioners for Her Majesty's Revenue and Customs

Facts

The appellant, S Patrick Erdal, held 17,131 Ordinary Shares and 53,476 non-voting "A" Ordinary Shares in Tullis Russell & Company Limited, a private paper-manufacturing company incorporated in 1906 whose business dated back to 1809, representing 1.189% of the Ordinary shares and 1.591% of the "A" Ordinary shares. He appealed against an amended assessment to capital gains tax in respect of chargeable gains made in 1995/96, 2000/01 and 2001/02, in the sums of £18,468.80, £28,744.20 and £8,628.40 respectively, and against a notice of surcharge for late payment of tax. The single question was the market value of the shares as at 31 March 1982 under section 35 of the Taxation of Chargeable Gains Act 1992. As at that date, 51% of the Ordinary shares were held by the Russell Trust, whose objects included maintaining the Company as an independent business in the interests of its employees, and the Articles restricted transfer of shares. The Company had recently installed a new paper machine and a £12m coating plant producing a novel high-gloss product, Trulux, launched on 22 March 1982. The appellant, appearing in person, contended for £3.29 per share; HMRC contended for £1.20–£1.25 (Ordinary) and £1.10–£1.15 ("A" Ordinary). The Tribunal was asked for a decision in principle.